Russia’s central bank increased key interest rates from 9.5 percent to 20 percent on February 28, as an immediate response to growing inflation in its fiat currency. According to source data, the ruble (RUB) is inflating, as the USDT/RUB exchange pair exceeded 105 RUB for the first time in history.
Prior to the increase, the USDT/RUB pair traded at a very stable market price of fewer than 80 rubles. However, with the start of the Russia-Ukraine war, the ruble’s market price versus USDT soared, briefly topping 90 rubles. Simultaneously, the ruble’s value fell as it continued to lose 30 percent of its purchasing power due to inflation.
Second, we will paralyse the assets of Russia’s central bank.
This will freeze its transactions.
And it will make it impossible for the Central Bank to liquidate its assets. pic.twitter.com/8H9eWkNCW9
— Ursula von der Leyen (@vonderleyen) February 26, 2022
The central bank stated: “An increase in the key rate will guarantee deposit rates rise to the levels required to compensate for rising depreciation and inflation risks. This will maintain financial and price stability and preserve citizens’ savings from devaluation.”
Whereas, BTC and altcoin trading activity on Ukrainian exchanges increased by more than 200 percent on mounting fears about the currency’s fiat stability.
Prominent crypto exchange Kuna’s volumes increased from less than $1 million on February 21 to around $4.1 million in three days. The National Bank of Ukraine has also imposed monetary restrictions, including withdrawal limitations, and has outright prohibited cross-border foreign currency transactions and withdrawals.